So while I have no problem with paid links from a moral, ethical or legal standpoint (nofollow is most definitely not a way to disclose advertising to consumers as per the FTC's guidelines), the pragmatist in me says link buying isn't the way to success at Google. What about directories that require a payment? The short answer is - it depends. I'd wager a lot of money that some directories which do require payments pass great link equity.
These include sites like: The Yahoo! Directory The Bet taiwan email list ter Business Bureau Directory SEMPO's Member Directory Apple's Web Apps Directory Then there's the opposite end of the spectrum of directories that exist primarily for the purpose of selling PageRank. Google took action against many of these a couple years back and I suspect they continue to identify and discount their links as new ones crop up. In 2007, I wrote a lengthy post on What Makes a Good Directory and I'd still stand by nearly all of that today.
The message here is that just because a site requires payment to get a link doesn't make it a "paid link" that Google will penalize or discount. As with many things in life, SEO and the web, there are shades of gray and nuances that require paying attention. If stuff like this were simple, SEO would be, too, and we know that's not the case. If I see my competitors engaging in link buying, how can I compete if I don't do it, too? I think a big misnomer with link analysis comes up when people scroll through a list of their competition's links via something like Yahoo! Site Explorer.
The penalties and problems of link buying simply outweigh the benefits in my mind
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